Blow up the Holiday Budget? Not This Year, Santa!
The holidays are too often a financial version of a crazy night out that leads to a long, regret-filled, hangover. But it doesn’t have to be. Use these tips to keep your holiday spending under control WHILE getting excellent gifts so you don’t break the budget this holiday season.
We’ve all been there - meandering around a mall, TJ Maxx, or website trying to find the perfect gift for our loved ones. It’s time consuming. It’s frustrating. We finally break down and get whatever we can find to finish up. Looking at our credit card statement in January we are astonished at how much we spent.
This year can be different! You don't have to go into debt just because it's December.
You can make a holiday plan that allows you to relax and not blow up the budget.
Getting presents for loved ones can be fun, simple, less consumeristic, better for the environment, and a true reflection of your feelings towards loved ones. And when it fits within your budget, you start next year off strong!
Below are a variety of tips that you can use to make sure this happens.
How do we overspend?
We spend more for an impressive, expensive label. “Look, I love you, this label proves it.” or “Look, I’m doing really well - in your face cousin Greg!”
We treat spending limits as a goal instead of a cap. Many friends and family try to keep spending limited by putting on a limit. “We can’t spend more than $50” - and then we spend $50.
We buy items just to cover our butts should someone give us a present we hadn’t planned for. (Which is more than we can say about that skirt we just got for our niece. #crankyoldlady #kidsthesedays #thatwastotallymebackinmyday)
We feel guilty that we don’t see loved ones enough and try to make up for this with expensive gifts.
These are a few ways we overspend, it’s by no means exhaustive. Even if we’re good all year, our January - May credit card statements each contain a wee little middle finger to us in the form of interest payments.
He’s the goodest elf.
Here are some ways you can make sure you aren’t still paying for the holidays in the spring.
Determine your holiday spending budget. This is Gwen Stefani to the rest of the list’s No Doubt. Which is to say, the rest of the list is good, but there’s no substitute for determining your holiday spending budget. This is your North Star. Once you have this, everything else falls into place. It gives you permission to spend as well as keeps you from overspending.
Once you know how much you have for gifts in total, list EVERYONE you will be buying a present for and estimate how much you want to spend on them. This not only keeps you in budget, but makes sure that the people who really are a priority to you are being treated as such.
Agree to spending ranges. Talk to friends and family. Explicitly come to an agreement about a range you can spend on each other. Once you’re within that range, you stop buying. This makes it easier to not spend until you hit the limit. (And don’t be that person who spends over the limit. This is not ‘nam. This is gift giving. There are rules)
Note: no one wants to admit they’re hard up for cash and often those struggling will use this as an excuse to “prove” they’re doing fine by buying extravagant presents which is really cutting off your nose to spite your face. If you know they’re struggling, you need to be the one to say “This year has been really hard, let’s stay within $10 - $15 or so.”
Keep track of what you’re spending. How will you know if you’re within your budget if you aren’t tracking how much you’re spending. See the video below for a great way to easily track your spending.
Limit the time you’re going to shop. If you’re going online, shop before you have a meeting or appointment. This time pressure will keep you focused and reduce the likelihood you meander and buy more stuff. Remember, the job of the store is to get you to buy. They’re really good at it. RESIST!
Shop at vintage and thrift stores. Not only can you find inexpensive, one-of-a-kind items, but you are being environmentally responsible by reducing the trash put out into the world. I have, on more than one occasion, come across shirts that made me think of friends. They just looked like something my friends would wear. One of which was a poop emoji tank top. She loved it. Find retro Garfield drinking cups, high-end cookware designed to last a lifetime that still has a lifetime to go, candles, shirts, and unique tins to give out baked goods if that’s your jam. Get it? Baked goods? Jam? Okay, fine. It wasn’t my best. Sorry (not sorry).
Shop local. Not only are you supporting your neighbors’ livelihoods and local artisans, you can actually spend less money and give a better gift. How? Because items from local shops are rare on a national scale (read: can’t get them on Amazon). These type of gifts make the recipient feel personally appreciated. A hand-crafted mug, an artist’s map of your town, a hand-printed t-shirt/kitchen towel/hat with a funny local saying - all of these are more meaningful to the recipient, but only cost between $20 - $50.
Beware buying to impress others. We all fall prey to this. Put a good label on the same shirt and suddenly it seems waaaaay nicer. But really, if they love you, they don’t want you in debt. It truly is the thought that counts and framing a ticket stub from a concert you went to together as teenagers for $30 is far more meaningful than an expensive shirt with a name on the tag. If they judge you for not getting a fancy-label item, eww. This is not a person you need in your life.
Set up family / friends gift swap. Instead of a dozen people having to buy eleven presents each, start a gift exchange. Each person buys for just one other person, no one knows who has who, you put out a list of items you’d like, and you just buy items from the list you get. It saves time and money and hassle. Downside: fewer presents. Upside: fewer items that get returned or brought to the thrift store, less time wasted returning items and dropping off items at the thrift store.
Like and follow Ms. Moody Money! Okay, this one doesn’t help you now, but if you get my newsletters (sign up at the bottom of the page), you would have read in the letter back in July that you had 20 weeks to save for the holidays. The average spent was $900 and that you could have $900 ready to go if you put away $45 a week. On the Facebook page in October you would have read that you could still squirrel away $25 a week and have $150 by today. Point being, I got you, boo. But you’ll only get me if you’re paying attention.
I made a YouTube video explaining an easy method of how to follow your holiday budget. It ensures you don’t spend more than you have in your bank account and you don’t overspend. Watch the video and see if you can find the second “Die Hard” reference. Oh, and subscribe for more video goodness!
Those are my tips for getting through this season without a holiday spending hangover. Which do you find most useful? Let me know in the comments!
Cheers,
Ms. Moody